Companhia Siderúrgica Nacional (SID) AI Stock Analysis

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Companhia Siderúrgica Nacional

(NYSE:SID)

Rating:55Neutral

Price Target:―

Companhia Siderúrgica Nacional's stock score reflects a challenging financial performance with high leverage and negative net income, offset by strong operational results in specific segments like mining and cement. Technical indicators show slight bullish momentum, while valuation concerns arise due to a negative P/E ratio. The recent earnings call provided positive insights into operational improvements and strategic focus, but highlighted risks related to exchange rate impacts and market dynamics. The high dividend yield adds some appeal, though the absence of immediate distributions and external market challenges remain notable risks.

Companhia Siderúrgica Nacional (SID) vs. SPDR S&P 500 ETF (SPY)

Market Cap

$2.06B

Dividend Yield13.17%

Average Volume (3M)3.00M

Price to Earnings (P/E)―

Beta (1Y)1.07

Revenue Growth-9.84%

EPS Growth-14783.33%

CountryUS

Employees24,924

SectorBasic Materials

Sector Strength64

IndustrySteel

Share Statistics

EPS (TTM)-0.10

Shares Outstanding1,326,094,000

10 Day Avg. Volume4,323,842

30 Day Avg. Volume3,002,204

Financial Highlights & Ratios

PEG Ratio0.78

Price to Book (P/B)0.94

Price to Sales (P/S)0.00

P/FCF Ratio5.38

Enterprise Value/Market CapN/A

Enterprise Value/RevenueN/A

Enterprise Value/Gross ProfitN/A

Enterprise Value/EbitdaN/A

Forecast

1Y Price Target

$1.30

Price Target Upside-18.24% Downside

Rating ConsensusModerate Sell

Number of Analyst Covering1

Companhia Siderúrgica Nacional Business Overview & Revenue Model

Company DescriptionCompanhia Siderúrgica Nacional operates as an integrated steel producer in Brazil and Latin America. It operates in five segments: Steel, Mining, Logistics, Energy, and Cement. The company offers flat steel products, such as high, medium, low carbon, micro-alloyed, ultra-low-carbon, and interstitial free slabs; hot-rolled products, including heavy and light-gauge hot-rolled coils and sheets; cold-rolled products comprising cold-rolled coils and sheets; galvanized products; tin mill products that consist of flat-rolled low-carbon steel coils or sheets; and profiles, channels, UPE sections, and steel sleepers for the distribution, packaging, automotive, home appliance, and construction industries. It primarily explores for iron ore reserves at Casa de Pedra and Engenho mines located in the city of Congonhas; and limestone and dolomite at the Bocaina mine located in the city of Arcos in the state of Minas Gerais, Brazil, as well as produces tin. In addition, the company operates railway and port facilities; produces and sells cement to construction material stores, home centers, concrete producers, construction companies, mortar industries, and cement artifact producers; and generates electric power from its thermoelectric co-generation and hydroelectric power plants. It also exports its products. The company was incorporated in 1941 and is headquartered in São Paulo, Brazil. Companhia Siderúrgica Nacional operates as a subsidiary of Vicunha Aços S.A.

How the Company Makes MoneyCompanhia Siderúrgica Nacional (SID) generates revenue through a diversified business model. The primary revenue stream comes from the production and sale of steel products, which are sold both domestically and internationally. The company also benefits significantly from its mining operations, as it extracts and sells iron ore, which is a critical raw material for steel production and is also sold to third parties. Additionally, CSN has a cement division that produces and sells cement products, leveraging by-products from its steel and mining operations. The company's logistics segment provides transportation and port services, further contributing to its revenue. CSN's energy segment supports its operations and offers potential cost savings and additional revenue streams through the sale of surplus energy. Strategic partnerships and joint ventures in various sectors also play a role in enhancing CSN's market presence and profitability.

Companhia Siderúrgica Nacional Earnings Call Summary

Earnings Call Date:May 08, 2025

(Q4-2024)

% Change Since: -7.56%|

Next Earnings Date:Aug 13, 2025

Earnings Call Sentiment Positive

The earnings call highlighted strong performances and record achievements in cash holdings, mining, steel, and cement segments, along with significant ESG advancements. However, the call also noted challenges such as the impact of exchange rates on debt, negative cash flow despite operational success, and the strategic decision to withhold dividend distribution. Additionally, there are concerns about market dynamics in the steel sector, particularly related to imports and protectionist measures.

Q4-2024 Updates

Positive Updates

Record Cash Holdings

CSN achieved the highest cash holdings in its history, almost reaching BRL 25 billion, enabling better control over the company's leveraging.

Strong Mining Segment Performance

The mining segment confirmed operational excellence, achieving production guidance despite adverse weather, and experienced a 35% price increase leading to an EBITDA margin above 50%.

Steel Segment Recovery

The steel segment saw a 10% increase in sales compared to the previous year, with EBITDA margins reaching 11% for the first time in the year, indicating a recovery trend.

Cement Segment Record Margins

CSN Cement achieved a record EBITDA margin of 33%, the highest since acquiring Lafarge Holcim, outperforming market averages.

ESG Achievements

CSN reported no fatalities, a 63% reduction in lost days, and a 7% reduction in CO2 emissions in the steel mill, bringing them closer to their 2030 goals.

Negative Updates

Exchange Rate Impact on Debt

The leverage increased due to exchange rate variations on dollar-denominated debt, impacting the financial results despite operational improvements.

Negative Cash Flow Despite Strong Operations

Despite strong operational results, CSN experienced a negative cash flow due to financial expenses affected by exchange rate effects and high investment volumes.

Decision to Not Distribute Dividends

CSN decided not to distribute dividends in the first quarter of 2025 to focus on deleveraging, as approved by the Board.

Anticipated Challenges in Steel Market

Concerns were raised about the impact of protectionist measures and unloyal competition from imports, particularly from China, affecting the steel market.

Company Guidance

In the call, CSN reported strong performance for the fourth quarter and full year 2024, highlighting significant metrics such as achieving the highest cash in its history at nearly BRL25 billion. The company emphasized its operational excellence in mining, evidenced by a 35% price increase and an EBITDA margin over 50%. In steel, CSN saw a 10% increase in sales compared to the same period last year, leading to an EBITDA margin of 11% in the fourth quarter. The cement segment reached a record EBITDA margin of 33%, the highest since acquiring Lafarge Holcim. CSN also detailed its commitment to deleveraging, with a semester-end leverage ratio impacted by exchange rate variations but operationally closer to 3.2 times. The company's strategy includes capital recycling and a focus on organic growth, postponing dividend distributions to prioritize deleveraging. CSN's guidance for 2025 includes continued operational improvements and strategic investments to foster growth and maintain financial health.

Companhia Siderúrgica Nacional Financial Statement Overview

Summary

Companhia Siderúrgica Nacional exhibits a mixed financial performance with profitability challenges and high leverage. While operational efficiencies are present, they are insufficient to counteract the negative net income and declining revenue growth. The balance sheet's significant debt level poses risks, although cash flow generation offers some resilience. Strategic improvements are necessary for sustaining financial health.

Income Statement

Neutral

The income statement shows a decline in revenue from the previous periods with a negative net income. The gross profit margin for the TTM period is 26.7%, while the net profit margin is -4.9%, indicating a challenging operational environment. EBIT and EBITDA margins are at 9.6% and 17.9% respectively, showing some operational efficiency, but not enough to offset the losses. Continued negative net income highlights profitability issues.

Balance Sheet

Neutral

The balance sheet reflects a high debt-to-equity ratio of 4.14, indicating significant leverage which may pose risks in volatile markets. Stockholders' equity as a percentage of total assets is 13.1%, suggesting moderate financial stability. The return on equity is not calculable due to negative net income, showing a need for improvement in generating shareholder returns.

Cash Flow

Neutral

Operating cash flow is positive at 8.1 billion, but free cash flow has seen a decline compared to the previous year, indicating pressure on liquidity. The operating cash flow to net income ratio is not meaningful due to negative net income. The company has managed to maintain some cash flow strength despite overall profitability challenges.

TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Breakdown
Income Statement		Total Revenue
44.88B	43.69B	45.44B	44.36B	47.91B	30.06B
	Gross Profit
11.98B	15.31B	11.30B	13.31B	22.07B	10.94B
	EBIT
4.31B	4.27B	5.19B	7.40B	18.50B	7.53B
	EBITDA
8.04B	7.28B	8.58B	10.07B	23.08B	9.69B
	Net Income Common Stockholders
-2.19B	-2.59B	-318.21M	2.17B	12.26B	3.79B
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
20.75B	24.22B	17.59B	13.45B	19.30B	13.73B
	Total Assets
99.76B	103.91B	91.53B	85.35B	79.38B	63.00B
	Total Debt
54.12B	57.75B	45.59B	41.61B	33.12B	35.80B
	Net Debt
34.33B	34.44B	29.55B	29.62B	16.47B	25.86B
	Total Liabilities
83.50B	88.45B	71.84B	63.54B	56.00B	51.75B
	Stockholders Equity
13.08B	12.27B	17.50B	19.49B	20.31B	9.91B
Cash Flow		Free Cash Flow
2.28B	3.16B	2.88B	-3.33B	13.57B	7.89B
	Operating Cash Flow
8.11B	8.65B	7.29B	2.04B	16.43B	9.58B
	Investing Cash Flow
-1.47B	-1.12B	-4.59B	-11.45B	447.93M	-1.86B
	Financing Cash Flow
-1.59B	-103.83M	1.32B	4.75B	-8.53B	1.19B

Companhia Siderúrgica Nacional Technical Analysis

Technical Analysis Sentiment

Negative

Last Price1.59

Price Trends

50DMA

1.63

Negative

100DMA

1.56

Positive

200DMA

1.76

Negative

Market Momentum

MACD

>-0.01

Positive

RSI

46.16

Neutral

STOCH

23.49

Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For SID, the sentiment is Negative. The current price of 1.59 is below the 20-day moving average (MA) of 1.65, below the 50-day MA of 1.63, and below the 200-day MA of 1.76, indicating a bearish trend. The MACD of >-0.01 indicates Positive momentum. The RSI at 46.16 is Neutral, neither overbought nor oversold. The STOCH value of 23.49 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for SID.

Companhia Siderúrgica Nacional Risk Analysis

Companhia Siderúrgica Nacional disclosed 41 risk factors in its most recent earnings report. Companhia Siderúrgica Nacional reported the most risks in the “Finance & Corporate” category.

Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy

Latest Risks Added 1 New Risks

Cement is a perishable product and failure to carefully store and distribute it may result in losses for our cement subsidiary and us. Q4, 2023

Companhia Siderúrgica Nacional Peers Comparison

Overall Rating

UnderperformOutperform

Sector (50)

Financial Indicators

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
SIM	78 Outperform	$4.45B	7.12	19.79%	―	-15.93%	86.43%
GGB	73 Outperform	$5.43B	9.56	5.86%	5.09%	-9.33%	-51.03%
CMC	72 Outperform	$5.21B	76.62	1.78%	1.56%	-7.93%	-89.29%
TX	62 Neutral	$5.43B	73.52	-2.75%	11.21%	-10.20%	-152.18%
SID	55 Neutral	$2.06B	―	-16.28%	13.17%	-9.84%	-14783.33%
Sector *	50 Neutral	$2.00B	-1.13	-21.16%	3.71%	2.15%	-30.95%
CLF	48 Neutral	$3.21B	―	-17.57%	―	-15.00%	-423.14%

* Basic Materials Sector Average

Performance Comparison

SID

Companhia Siderúrgica Nacional

1.61

-0.85

-34.55%

CLF

Cleveland-Cliffs

6.38

-10.56

-62.34%

CMC

Commercial Metals Company

48.88

-5.76

-10.54%

GGB

Gerdau SA

2.84

-0.59

-17.20%

SIM

Grupo Simec SA De CV

28.02

-4.73

-14.44%

Ternium SA

28.28

-10.76

-27.56%

Glossary

OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.

NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.

UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.